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Key Impact Points:
- ADNOC boosts its shareholding in Fertiglobe to 86.2%, reinforcing its ambition to become a top five global chemicals player.
- Fertiglobe becomes ADNOC’s platform for global expansion in fertilizers and low-carbon ammonia.
- ADNOC plans to more than double Fertiglobe’s ammonia capacity by transferring existing and future low-carbon ammonia projects to the company.
ADNOC has completed the acquisition of OCI Global’s majority stake in Fertiglobe, increasing its ownership to 86.2%. The remaining 13.8% of shares will continue to trade freely on the Abu Dhabi Securities Exchange.
Why it matters: Fertiglobe is the world’s largest seaborne exporter of urea and ammonia, supplying 53 countries and holding approximately 10% of the global market share in these products.
Driving the news: This acquisition marks a significant milestone in ADNOC’s ambitious chemicals growth strategy and its expansion into low-carbon fuels.
- Fertiglobe will serve as ADNOC’s global platform for growth in fertilizers and low-carbon ammonia.
- ADNOC intends to transfer its stakes in existing and future low-carbon ammonia projects to Fertiglobe at cost upon startup, creating a world-class growth platform for this key energy transition fuel.
By the numbers:
- The two low-carbon ammonia projects in Abu Dhabi will add approximately 2 million tons per annum (mtpa), more than doubling Fertiglobe’s current merchant ammonia capacity of 1.6 mtpa.
- This expansion increases Fertiglobe’s total sellable capacity to 8.6 mtpa of net ammonia and urea combined.
What they’re saying:
“ADNOC’s majority shareholding in Fertiglobe marks another milestone in the delivery of our ambitious international chemicals growth strategy and goal to become a top five chemicals player,” said His Excellency Dr. Sultan Ahmed Al Jaber, ADNOC Managing Director and Group CEO. “Fertiglobe is a world-class company, and it will be the vehicle through which ADNOC advances its low-carbon ammonia business, supporting our efforts to enable a just, orderly, and equitable global energy transition.”
Leadership continuity: Fertiglobe’s current management team will remain in place, reflecting ADNOC’s confidence in their expertise.
- CEO Ahmed El-Hoshy will continue to lead Fertiglobe, bringing extensive experience from his 15 years growing OCI’s U.S. and European ammonia and methanol businesses.
“The successful completion of the ADNOC transaction is a historic milestone for Fertiglobe, reinforcing the positive long-term outlook for our business and unique market position,” El-Hoshy commented. “We look forward to joining ADNOC’s integrated ecosystem and unlocking the full potential of our product portfolio while maximizing shareholder value and maintaining our commitment to balancing disciplined growth with dividend distributions.”
Looking ahead:
- Fertiglobe will continue to grow its low-carbon fuels business, having recently secured €397 million in renewable ammonia offtake to Europe through the H2Global initiative.
- The company aims for robust double-digit internal rates of return (IRRs) on all future growth projects, targeting disciplined and value-accretive growth to capitalize on the expected increase in global low-carbon ammonia demand.
Related Article: ADNOC Acquires 35% Stake in ExxonMobil’s Texas Hydrogen Plant for Decarbonization Efforts
Market context:
- Demand for low-carbon ammonia is projected to grow to 24 million tons by 2032, up from close to zero currently.
- ADNOC aims to capture 5% of the global low-carbon hydrogen market by 2030, supporting the UAE’s National Hydrogen Strategy.
What’s next:
- Fertiglobe will detail its value creation and growth strategy during its Capital Markets Day in Q1 2025.